Zoho's Sridhar Vembu warns businesses as memory prices surge 500%
What's the story
Sridhar Vembu, the founder of Zoho, has expressed his concerns over the skyrocketing prices of memory chips. The surge is being driven by the increasing demand from AI data centers. On X, Vembu shared a post citing a recent report highlighting that "Memory prices up 500% in 12 months." He said this price hike and rising AI token costs were making it hard to do business.
Business impact
DDR5 memory kits have seen a price surge
Vembu revealed that his company has refrained from increasing prices but the situation is becoming increasingly difficult.
Average prices for certain DDR5 RAM kits jumped more than fourfold between August 2025 and August 2026, rising from $90 (₹8,600) to $425 (₹40,000).
Higher-capacity kits have witnessed even more drastic price hikes. For instance, a 128GB DDR5-6400 kit now costs $3,399 (₹3,25,000), which is 10 times its lowest-ever tracked price of $329 (₹31,490).
Industry-wide effect
Price hikes affecting entire tech ecosystem
The rising costs are not just affecting Zoho but the entire tech industry.
Smartphone makers like OPPO, OnePlus, Vivo, and Nothing have all increased their prices in recent months.
There are also speculations of Apple following suit with potential iPhone price hikes.
This shows that both device manufacturers and software companies are feeling the pinch of these rising costs.
Tech evolution
Programming languages need a revamp
In light of the memory crisis, Vembu believes it's time to rethink how we design programming languages.
He said, "For a long time, programming languages were designed with the assumption that memory is 'free.' That era has now ended."
He stressed the need for highly memory-efficient languages and smarter compilers even for AI.
Data center expansion
AI data center race heating up
Amid the rising demand, AI companies are investing heavily in building more data centers globally.
OpenAI recently signed a deal with SoftBank's SB Energy for a 10-gigawatt data center in Ohio, one of the largest ever. The deal is partly backed by NVIDIA's commitment of up $105 billlion.
Indian firms are also joining this trend with HCLTech planning to invest ₹3,500 crore and TCS looking to spend up to $7 billion on a 1-gigawatt data center unit.